B’nai B’rith, Facing Large Deficit, Planning Layoffs, Big Budget Cuts

The latest American Jewish organization to fall victim to the economic pressures that have forced several national Jewish groups to retrench is B’nai B’rith International.

B’nai B’rith, which bills itself as the largest Jewish organization in the world, is facing a $2 million deficit this fiscal year, which ends June 30, and a $2 million cut from next year’s budget.

The organization is laying off 28 staff people, closing three regional offices of the B’nai B’rith Youth Organization and cutting 10 percent across the board from the B’nai B’rith Hillel Foundation budget.

The current $2 million shortfall is being covered by drawing from what one B’nai B’rith leader called the organization’s “considerable cash reserves, which are in excess of $8 million.”

Drawing from interest-earning cash reserves is generally considered a measure of last resort, explained Seymour Reich, the group’s immediate past international president, because “you need to generate the income, and you can’t use your principle as an operating account.”

Looking to next year, B’nai B’rith officials predict no increase in income from fund raising, which has been flat for the last three years, and an increase in expenses because of inflation.

Based on these forecasts, the amount needed to maintain the size and strength of B’nai B’rith’s staff and programs for the 1991-92 fiscal year would have been $16 million.

But since the organization’s fiscal management committee foresees another $2 million deficit, it has proposed a budget cutback of that amount, which requires staff layoffs, regional office closings and program cutbacks.

AT LEAST 28 STAFF LAYOFFS

The proposed budget will be considered by B’nai B’rith’s 104-member Board of Governors at its next semi-annual meeting in Washington on May 4 to 6.

At least 28 employees, both professional and clerical staff, are being laid off as of July 1. They are being taken from B’nai B’rith and BBYO offices across the country, according to Sidney Clearfield, B’nai B’rith’s recently appointed executive vice president.

Three regional BBYO offices, in the Pacific Northwest, Central New York state and Illinois, will close, as well. BBYO runs programs for high school students.

The impact of the youth-program cuts is that “there will be a void in BBYO and Hillel programs,” admits Reich, who remains a member of the Board of Governors and is a member of the financial management committee.

BBYO and Hillel each receive about $3.5 million annually from B’nai B’rith, a sum which is expected to be slashed by between $280,000 and $350,000. For Hillel, that means that the part of each chapter’s budget that comes from B’nai B’rith will be cut by 10 percent.

Hillel has chapters on 105 campuses that are led by professionals and receive funding from B’nai B’rith. There are also student-led affiliates on 300 campuses, which do not receive funding.

The cutbacks will also impact all of Hillel’s eight regional offices.

“Ours are not agencies with a lot of fat to trim from the budgets,” said Richard Joel, international director of Hillel.

“We will not do across-the-board cuts again. We are not a salami,” he said. “We felt right now the system would bear this cut.”

DECLINING MEMBERSHIP CITED

While the $3.5 million annual B’nai B’rith contribution to Hillel’s budget is a relatively small part of Hillel’s $18.5 million funding, the 10 percent cut means some Hillel chapters will have to offer fewer activities to students, Joel said.

But he indicated that no Hillel offices would be closed.

Local Hillel boards of directors will raise the shortfall in some communities, Joel said. And Hillel “will have to look more aggressively in the future for major gifts and endowments,” he said.

Up until the 1970s, Hillel was wholly funded by B’nai B’rith International. But now about $8 million of funding comes from local federations, and another $6 million to $7 million is raised from parents and alumni, Joel said.

While Hillel and BBYO receive half of B’nai B’rith’s annual budget, they are being spared, to some extent, the budget paring that the rest of the B’nai B’rith organization is facing.

Saving BBYO and Hillel from the harshest cuts is part of B’nai B’rith’s emphasis on its youth programs.

Membership, organized through 1,400 lodges and units around the country, has historically been B’nai B’rith’s focus. It is a system that suited a generation of Jews who were excluded from other fraternal organizations and clubs.

But some say the current generation of young Americans is looking for a different type of organization.

“People don’t want to go to meetings any more,” observed Reich. “They’re perfectly happy to contribute their money and will only get involved in dramatic issues, like Israel.”

B’nai B’rith’s membership levels have been sinking for years.

Just five years ago, said Clearfield, the organization had 140,000 dues-paying members. Today that number is 115,000.

“Most lodges and units aren’t functioning,” said one former B’nai B’rith staff member, citing attrition as a major factor.

THE LODGE ‘HAS SEEN ITS DAY’

“A big internal study conducted three or four years ago found that the average age of members is 65,” the former staffer said. “How many of the members today are under 50?”

“Leadership is going to take a real strong look at the efficacy of lodges and units,” said Hillel’s Richard Joel.

“There are lodges around the country which serve real strong roles in their communities. But as the basic social structure of the community, it has seen its day,” he said.

While B’nai B’rith’s executive vice president pledges the organization will not diminish its commitment to public affairs, education and culture, and serving senior citizens, Clearfield says B’nai B’rith’s shrinking resources are being directed to programs for high school and college students for a clear reason.